Liability for Estate Debts in Germany

Under German law, the estate passes automatically to the heir and the heir becomes personally liable for estate debts. However, the heir can avoid personal liability. This article describes how personal Debt liability can be avoided under German law.

Principle of Universal Succession

Under German law, the estate (Nachlass) passes automatically to the heir (Erbe) or, if there is more than one heir, to the community of co-heirs (Erbengemeinschaft) at the time of death. See § 1922 German Civil Code (BGB). While § 1922 (1) BGB only speaks of succession to the estate of the decedent, § 1967 (1) BGB makes it clear that the heir also is liable for estate debts (Nachlassverbindlichkeiten). Pursuant to § 1967 BGB the term "estate debts" includes

the debts of the deceased (Erblasserschulden),

the obligations borne by the heirs as such (Erbanfallschulden),

in particular the obligations arising from rights to the forced share (Pflichtteil), a legacy (Vermächtnis) and a testamentary burden (Auflage).

Furthermore, the heir must also bear the funeral costs (Kosten der Bestattung). See § 1968 BGB.

Please Note: The liability of the heir is not limited to the estate. Creditors may also enforce their claims into the property the heir already had before he received the inheritance.

Debt Liability of the Co-Heirs

Pursuant to §2058 BGB, co-heirs are jointly liable for estate debts. Each co–heir (Miterbe) is liable for the estate debt seperatly. Until the distribution of the estate he may limit his liablility to his share of the estate. See § 2059 BGB.

After the distribution of the estate, each co-heir is liable for the part of the estate debt that corresponds to his share of the inheritance. See § 2060 BGB.

Avoidance of Debt Liability

If the heir can still disclaim the inheritance, he should timely consider a disclaimer of inheritance (Ausschlagung). If he erranously accepted the inheritance, he may contest the disclaimer (Anfechtung der Annahme).

After acceptance of the inheritance, the liability of the heir can be limited to the estate if the court orders curatorship for the protection of the creditors of the estate (Nachlassverwaltung) or estate insolvency proceedings (Nachlassinsolvenzverfahren) are instituted (§ 1975 BGB).

If there are not sufficient assets in the estate to cover the costs of the curatorship or estate insolvency proceedings, the heir may refuse to satisfy a creditor of the estate to the extent that the estate is insufficient (Einrede der Dürftigkeit des Nachlasses). In this case, the heir is obliged to deliver the estate for the purpose of satisfying the creditor by way of execution of judgment (§ 1990 BGB).

Jan-Hendrik Frank
08/14/2018

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